The latest Centrix Credit Indicator (March 2026) shows New Zealand’s credit conditions have improved overall, with consumer arrears falling after last month’s seasonal peak. While the headline numbers are moving in the right direction, pressure remains more pronounced across unsecured lending, especially BNPL and personal loans.
In our March market report, consumer arrears had reached 12.56%, with 491,000 people behind on payments.
This month, arrears have fallen to 12.09%, with the number of people behind on payments declining to 473,000, down 18,000 from the prior month. Arrears are now 2.4% lower than a year ago. However, deeper stress remains, with 97,000 consumers now 90+ days in arrears, the highest level since July 2023.
Mortgage Arrears Hold Steady
Mortgage arrears held steady at 1.42% in February, unchanged from the previous report. The number of home loans past due increased slightly from 22,600 to 22,700.
Despite this, mortgage arrears are 8% lower than a year ago, supported by lower interest rates easing repayment pressure for borrowers.
Credit Cards Improve
Credit card arrears improved from 4.2% in the previous report to 4.0% this month. Arrears are now 12% lower than a year ago, showing stronger performance compared to recent months.
Demand remains weak, down 19.1% year on year, suggesting consumers are still cautious about revolving credit.
Personal Loans Ease Slightly, But Remain High
Personal loan arrears improved slightly from 10.2% to 10.1%. While this is a small step in the right direction, this remains one of the key pressure points, with arrears still 4% higher year on year.
Demand also remains strong, with personal loan enquiries up 13.0% year on year, continuing the trend seen in recent months.
BNPL Continues to Climb
BNPL arrears rose again, increasing from 8.6% in the previous report to 9.5% this month. This marks the fifth consecutive monthly increase, making BNPL one of the clearest areas of concern.
Demand is broadly stable, up 3.8% year on year, suggesting usage remains steady even as repayment pressure builds.
The Bigger Picture
Compared with our March market report, the overall direction has improved, but unsecured lending remains under strain:
- Total consumer arrears have fallen from 491,000 to 473,000
- The arrears rate has dropped from 12.56% to 12.09%
- Mortgage arrears have held steady at 1.42%
- Credit card arrears have improved from 4.2% to 4.0%
- Personal loan arrears have eased slightly from 10.2% to 10.1%
- BNPL arrears have climbed from 8.6% to 9.5%
The latest data suggests the seasonal arrears peak has started to unwind, with overall arrears improving and mortgage stress remaining stable. However, the rise in 90+ day arrears and continued pressure across BNPL shows that some households are still under sustained financial strain.
As we move further into the year, the key area to watch will be whether unsecured credit begins to stabilise, or whether BNPL and personal loan arrears continue to diverge from the broader improvement in household credit conditions.
